BAE Systems PLC (LSE:BA.), the maker of the CV90 Armadillo tank, looks to be one of the few direct beneficiaries of the war in Ukraine, though the company used euphemistic phrases such as "elevated threat environment" to avoid actually broaching the subject.
That said, there were two direct mentions of the conflict in the company’s annual results statement.
First, it said it expects the renewed importance of armoured combat vehicles in the Ukraine conflict to benefit its combat vehicles business.
Investors were also told the US Department of Defense intends to buy over 100 additional AMPV vehicles to replace the 200 in-service M113 armoured personnel carriers provided to the war-ravaged former Soviet state.
“While it is tragic that it took a war in Europe to raise the awareness of the importance of defence around the globe, BAE Systems is well positioned to help national governments keep their citizens safe and secure in an elevated threat environment,” investors were told.
The company, which also makes the Eurofighter Typhoon jet along with a host of other military equipment and vehicles, reported an 8.9% bump in revenues year over year in 2022 to £21.26bn, while operating profits were static at £2.38bn. The dividend will rise 7.6% to 27p.
According to Reuters, earnings were slightly ahead of consensus.
Looking ahead, BAE said it expects sales to grow 3-5% in 2023, resulting in a 4-6% increase in underlying earnings.
"Our backlog is at £59bn, we're accelerating our investment in the business and making excellent progress on our share buyback programme, which complements the proposed increase in the dividend,” said the company’s head of finance, Brad Greve.
"For 2023, we're forecasting further top-line growth, continued margin expansion, higher EPS and we're also increasing our rolling three-year cash targets, all of which demonstrate that the business has growing momentum for the future."